Lotfeeders keep faith despite tough times

28 Nov, 2009 01:00 AM
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LOTFEEDERS are in the midst of negotiating contracts for 2010, with price reports so far appearing to be mixed but certainly nothing to rave about.

While the easing of grain prices has helped curb input costs, some lotfeeders say that is being used as a reason for reducing contract prices.

The Western Meat Packers fire has also created a level of uncertainty.

WA Lot Feeders Association president Ivan Rogers said the negotiaton period for 2010 pricing was still active, and price indications to date were mixed.

"Some prices are okay, some are not so okay," Mr Rogers said.

"We're hoping for similar prices to 2009, but we're still caught in a dilemma because there is an oversupply of beef nationally so there just isn't that pressure on pricing.

"Beef that normally would be exported hasn't been and has been put onto the domestic market.

"What we're negotiating for are prices similar to 2009; we could probably stand a small fall as it would be offset by reduced grain prices."

Mr Rogers said WALFA was concentrating on ensuring WA beef was well represented on the domestic market, so the quality of local beef was available to retailers.

"We're working so our beef isn't eroded on the domestic market," Mr Rogers said.

"We trying to ensure that beef is well represented as being local beef and maintaining our market share, so we'll continue to talk to all players and reassure them that we can produce a consistent, quality product.

"We're underutilised, so we need to continue to assist retail outlets so that the quality of beef is getting to the consumer."

Boyup Brook lotfeeder Milton Moore said so far he had one contract signed up for 2010, but the rest had been put on hold due to the Western Meat Packers fire.

Mr Moore said prices hadn't been too bad, but there wasn't any sign of price rises.

"Prices seem to be slightly discounted," Mr Moore said.

"Lower grain prices help us a lot but the funny thing is that when grain prices were high, our prices didn't go up but when they're low, the prices go down."

Mr Moore said there were two main points taken into consideration for lotfeeders: grain prices and the price of feeder calves.

"If our contract prices are less, then we pay less for feeder calves which hurts the cow-calf producer and they can't pass that loss on," Mr Moore said.

"They just have to wear it."

Mr Moore said he had some exciting plans in place for his enterprise and although it was a tough time in the beef industry at the moment, he believes it has a bright future.

"There are a lot of good people in the beef industry but we probably need the whole industry to go through a bit of a revamp," Mr Moore said.

"We've got the cattle, the environment, the supply of grain, population with strong average wage and good access to Asian markets.

"There are a lot of positives, we just need to make the most of it."

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